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Company car tax: too complex?

  • Many people complain about BIK tax
  • Some manufacturers are trying to help
  • Vote in our poll and have your say!

"Congratulations, you're now eligible for a company car. We'll pay for everything - you just need to tax it!"

Sounds great, but where to start?

So you take the CO2 emissions of your car, work out how much you need to be taxed... or do you need the P11d value first? How do you work out which pay scale you're on?

You're getting the idea. Company car tax is something we at Company Car Driver get asked about on a regular basis. The main reason for this is that all - every single one of you - has to pay it on the car you run for work.

We've heard several gripes with the current system of taxation. Some believe it favours the higher earners, others complain that it isn't really promoting green motoring as it doesn't take mileage into account. Then there's the question of whether the 3% levy for diesel cars is relevant now, since diesel cars are much cleaner than they used to be.

Another issue with the system as it is now is the problem with the thresholds the Government publishes. We've currently only got information for the next three years, yet many people are on four-year lease deals now as firms try to tighten purse strings in the wake of the recession. How are you meant to budget for a car now when you have no idea how much it'll cost to run in the final 12 months of your lease period?

Some of the major car manufacturers are taking steps to overcome the issues surrounding company car tax by training staff in their dealerships to explain the issues to potential company car buyers. Both Volvo and Mazda have announced such schemes this month, which is a positive start, but wouldn't it be better for the Government to make life easier for all of you?

So here's the question: is company car tax too complicated, and what could be done to improve it? Vote in the poll below and leave a comment to tell us what you think.